Daily Market Lookup

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was last quoted down 0.02% to 92.92. In China, prices data is due with CPI for September seen up 0.4% on month and up 1.6% on year, while PPI is expected to post a 6.3% gain. This week, investors will be looking at U.S. housing data to assess the economic impact of the hurricanes which hit the southern U.S. last month. Thursday’s data on third quarter Chinese growth will be closely watched for insight into the health of the world’s second largest economy. Tuesday’s UK inflation data will also be in focus amid speculation over a possible rate hike by the Bank of England as soon as next month. Last week, the dollar fluctuated against a basket of the other major currencies on Friday after mixed consumer inflation data clouded the outlook for another rate increase by the Federal Reserve in the coming months. Consumer prices rose 0.5% last month after advancing 0.4% in August the Labor Department reported Friday. Economists had forecast a 0.6% increase. It was the largest increase in eight months, but was mainly driven by soaring gasoline prices after hurricanes hit the southern U.S. Underlying inflation remained subdued.
The report came after the minutes of the Fed's September meeting published on Wednesday showed "many participants expressed concern that the low inflation readings this year might reflect not only transitory factors, but also the influence of developments that could prove more persistent." The data tempered expectations that the Fed will hike interest rates in December for a third time this year. European Central Bank President Mario Draghi said the euro zone still requires substantial monetary stimulus as inflation remains muted. Sterling gained ground amid hopes that Britain could be offered a two-year Brexit transition deal.

The U.S economy remains strong and the strength of the labor market calls for continued gradual increases in interest rates despite subdued inflation, Federal Reserve Chair Janet Yellen said on Sunday. “We will be paying close attention to the inflation data in the months ahead,” Yellen said in prepared remarks at an international banking seminar in Washington. “My best guess is that these soft readings will not persist.” Yellen also said she expected the U.S. economy to exceed its long-term trend during the second half of the year and repeated the impact of recent hurricanes on the economy should be temporary. Minutes from the meeting, released last Wednesday, showed policymakers had a broad debate about recent soft inflation and the impact on interest rates if it fails to rebound. However, Yellen and some other key policymakers have also made plain they expect to continue to gradually raise interest rates given the strength of the overall economy and continued tightening of the labor market. Fed officials largely shrugged off a weak jobs report for September and pinned the decline in employment on Hurricanes Harvey and Irma temporarily displacing workers. In her speech, Yellen said the most recent wage gains contained in the September jobs report were encouraging and that she expected the central bank to raise interest rates further. The central bank has raised interest rates four times in its tightening cycle which began in late 2015. The Fed currently predicts one more rate rise this year and three the next.

Oil markets opened up strong into the new week, with Brent crude up by one percent as concerns over renewed U.S. sanctions against Iran drove prices up. A falling U.S. rig count also supported prices there. Traders said that concerns over renewed U.S. sanctions against Iran were pushing prices up. U.S. President Donald Trump struck a blow against the 2015 Iran nuclear deal on Friday, defying both U.S. allies and adversaries by refusing to formally certify that Tehran is complying with the accord even though international inspectors say it is.
Under U.S. law, the president must certify every 90 days to Congress that Iran is complying with the deal. The U.S. Congress will now have 60 days to decide whether to reimpose economic sanctions on Tehran that were lifted under the pact. During the previous round of sanctions against Iran, some 1 million barrels per day (bpd) of crude oil supplies were cut off global markets. While analysts said they did not expect renewed sanctions to have such a big impact again, especially as the United States would likely act alone, they did warn that such a move would be disruptive. Within the United States, crude prices were also up as drillers cut back the number of rigs tapping new production. Drillers cut five oil rigs in the week to Oct. 13, bringing the total count up to 743, the lowest since early June, General Electric Co's (N:GE) Baker Hughes energy services firm said in its closely followed report late on Friday.

Intraday RESISTANCE LEVELS

16th October 2017

R1

R2

R3

GOLD-XAU

1,312-1,321

1,329

1,335

Silver-XAG

17.50

18.00-18.35

18.60

Crude Oil

52.00

52.50-53.00

53.70

EURO/USD

1.1850-1.1875

1.1925

1.1981

GBP/USD

1.3300

1.3360-1.3400

1.3450

USD/JPY

112.30-113.00

113.60

114.50114.50

Intraday SUPPORTS LEVELS

16th October 2017

S1

S2

S3

GOLD-XAU

1,294-1,288

1,279

1,273-1,266

Silver-XAG

17.20

16.70

16.35-16.00

Crude Oil

51.50-50.90

50.10

49.00-47.80

EURO/USD

1.1800-1.1770

1.1700

1.1660-1.1610

GBP/USD

1.3260-1.3200

1.3150

1.3100-1.3015

USD/JPY

111.50-111.10

110.70

109.80

Intra-Day Strategy (16th October 2017)

GOLD-XAU

Neutral

Silver-XAG

Neutral

Crude Oil

Neutral

EUR/USD

Neutral to Sell

GBP/USD

Neutral to Sell

USD/JPY

Neutral to Sell

Gold – XAU

Gold on Friday made its intraday high of US$1303.66/oz and low of US$1290.85/oz. Gold was up by 0.790% at US$1303.53/oz.

Technicals in Focus:

In daily charts, prices are above 50DMA (1267) and breakage below will call for 1234-1224. MACD is below zero line and histograms are increasing trend and it will bring upward stance in the upcoming sessions. RSI is in overbought region and more upside is expected before it gets stretched. Stochastic Oscillator is in neutral territory and giving positive crossover to confirm bearish stance for intraday trade.

Silver - XAG

Silver on Friday made its intraday high of US$17.39/oz and low of US$17.16/oz. Silver settled up by 0.987% at US$17.39/oz.

Technicals in Focus:

On daily charts, silver is sustaining above 200DMA (17.16), breakage below will lead to 16.70-16.35. MACD is above zero line and histograms are increasing trend and it will bring bullish stance in the upcoming sessions. RSI is in oversold region, indicating buy signal for now. The Stochastic Oscillator is in oversold region and giving positive crossover to show upside move for the intraday trade.

Oil - WTI

Crude Oil on Monday made an intra‐day high of US$51.70/bbl, intraday low of US$50.67/bbl and settled up by 1.301% to close at US$51.39/bbl.

Technicals in Focus:

On daily charts, oil is sustaining below its 200DMA i.e. 49.60 which is a major resistance and breakage above will call for 50.30-51.00. MACD is below zero line and histograms are in decreasing mode will bring bearish stance in the upcoming sessions. The Stochastic Oscillator is in overbought region and giving positive crossover for confirmation of bullish stance; while the RSI is in oversold region and more downside can be expected.

Trading Strategy: Neutral

Based on the charts and explanations above; sell below 52.00-53.70 with stop loss at 53.70; targeting and 51.50-50.90-50.10 and 49.00- 47.80. Buy above 51.50-47.80 with risk daily closing below 47.80 and targeting 52.00- 52.50 and 53.00-53.70.

Intraday Support Levels

S1

51.50-50.90

S2

50.10

S3

49.00-47.80

Intraday Resistance Levels

R1

52.00

R2

52.50-53.00

R3

53.70

TECHNICAL INDICATORS

Name

Value

Action

14DRSI

60.826

Sell

20-DMA

50.88

Buy

50-DMA

49.23

Buy

100-DMA

47.83

Buy

200-DMA

49.45

Sell

STOCH(5,3)

85.190

Sell

MACD(12,26,9)

0.508

Sell

EUR/USD

EUR/USD on Friday made an intraday low of US$1.1874/EUR, high of US$1.1804/EUR and settled the day down by 0.0591% to close at US$1.1822/EUR.

Technicals in Focus:

On daily charts, prices are sustaining above 20DMA (1.1937), which become immediate support level, break below will target 1.1700-1.1600. MACD is below zero line but histograms are increasing mode which will bring bullish view. Stochastic is in neutral territory and giving negative crossovers to signal for bearish outlook for intraday. 14D RSI is currently in neutral region and giving upwards directions to consider buy.

GBP/USD

GBP/USD on Friday made an intra‐day low of US$1.3246/GBP, high of US$1.3336/GBP and settled the day by up by 0.203% to close at US$1.3287/GBP.

Technicals in Focus:

On daily charts, prices are sustaining above 20DMA (1.3306) is become major support level. 14-D RSI is currently in neutral region and direction is difficult to predict on RSI bases. The Stochastic Oscillator is in overbought territory and giving negative crossover to confirm bearish stance. MACD is below zero line and histograms are decreasing lead to downward movement.

Trading Strategy: Neutral to Sell

Based on the charts and explanations above; short positions below 1.3300-1.3450 with targets at 1.3260-1.3200 and 1.3150-1.3100-1.3020. Buy above 1.3260-1.3015 with stop loss closing below 1.3000 targeting 1.3300-1.3360 and 1.3400-1.3450.

Intraday Support Levels

S1

1.3260-1.3200

S2

1.3150

S3

1.3100-1.3015

Intraday Resistance Levels

R1

1.3300

R2

1.3360-1.3400

R3

1.3450

TECHNICAL INDICATORS

Name

Value

Action

14DRSI

53.443

Buy

20-DMA

1.3381

Buy

50-DMA

1.3140

Buy

100-DMA

1.3030

Buy

200-DMA

1.2791

Buy

STOCH(5,3)

89.644

Sell

MACD(12,26,9)

0.0004

Buy

USD/JPY

USD/JPY on Friday made intra‐day low of JPY111.67/USD and made an intraday high of JPY112.30/USD and settled the day down by 0.427% at JPY111.79/USD.

Technicals in Focus:

Technical in Focus:
In daily charts, JPY is sustaining above 200DMA (112.15), which is major support on the daily chart. 14-D RSI is currently is approaching oversold region. MACD is above zero line but histograms are in decreasing mode which might lead to downward movement. The Stochastic Oscillator is approaching overbought territory and signaling to sell as it has given negative crossover to confirm bearish stance.